bba full report

Deposit and Loan Products of National Credit and Commerce Bank Limited

Daffodil International University

Internship Report on“Deposit and Loan Products

Of National Credit and Commerce Bank Limited’’

Submitted By

Golam Saroar Parvez

ID: 103-11-1736

Major: Finance

Department of Business Administration

Faculty of Business & Economics


© Daffodil International University 1


“Deposit and Loan Products

Of

National Credit and Commerce Bank Limited’’

Submitted To:

Rafiqul Islam

Professor & Advisor



Submitted By:

Golam Saroar Parvez

ID: 103-11-1736

Major: Finance




Date of submission

12 June, 2014


102, Sukrabad, Mirpur Road, Dhanmondi

Dhaka- 1207



LETTER OF TRANSMITTAL

Date: 12 June, 2014 Mr. Rafiqul Islam

Professor & Advisor



Subject: Submission of internship report.

Dear Sir,

It is a great pleasure for me to submit my internship report On “Deposit and Loan

Products of National Credit and Commerce Bank Limited’’ It was a great opportunity

for me to acquire knowledge and experience in respect of the functions, procedures, and

operational mechanism of a commercial bank based on conventional banking principle

while working in Kawran Bazar Branch of The National Credit And Commerce Bank

Limited. I believe that the knowledge and experience I have gathered during my

internship period will immensely help me in my professional and practical life.

I have concentrated my best efforts to achieve the objectives of the practical orientation

and hope that my endeavor will serve the purpose. However, I will always be happy to

welcome my further clarification that you may require.

Sincerely Yours

Golam Saroar Parvez

ID: 103-11-1736

Program: BBA

Batch: 27th




DISCLAIMER

I am, Golam Saroar Parvez, hereby declare that this report of internship titled “Deposit

and Loan Products of National Credit and Commerce Bank Limited’’, is prepared by me

after completion of three months work in The National Credit and Commerce Bank

Limited.

In addition, the report prepared is only for my academic requirement not for any other

purpose. It might not be used with the interest of opposite party of the organization.

…………………….

Golam Saroar Parvez

BBA Program

ID- 103-11-1736

Major: Finance






Certificate of Approval

I am pleased to certify that the internship report on “Deposit and Loan Products of

National Credit and Commerce Bank Limited’’ prepared by Golam Saroar Parvez

bearing ID: 103-11-1736 of the Department of Business Administration is approved for

presentation and defense. Under my supervision, he worked with National Credit and

Commerce Bank Ltd. as an intern. He has completed the work during the spring, 2014

semester.

I am pleased to certify that the data and findings presented in the report seem to be

authentic.

I wish him all success in life.

Supervisor

Mr. Rafiqul Islam

Professor & Advisor





Acknowledgement

First of all I am grateful to almighty Allah for blessing me in completing the report, “No

noble achievement can be achieved by an individual without help of others’’. I am

indebted to a number of people for their kind recommendation, submission, direction, co-

operation, and their collaboration.

It was a great pleasure for preparing Internship report on “Deposit and Loan Products of

National Credit and Commerce Bank Limited’’. I would like to thank and convey my

gratitude to honorable supervisor, Mr. Rafiqul Islam (Professor & Advisor, Faculty of

Business & Economics, Daffodil International University), for letting me to prepare

this report and I would also like to express my sincere appreciation to him for his

wholehearted support and guidance.

I am also grateful to the management of The NCCBL for offering me the Internship

training. My special thanks to Mr. Fardaus (Senior Officer), Shikha Rani Mrong (Senior

Principle Officer) who teach me about overall banking system of NCC bank limited with

significant, vital, imperative, and essential information during face-to- face conversation,

by providing some papers etc and I also like to thank Mr. Mohiuddin, who help me from

core of his heart as like as a younger brother in learning Credit Management procedure of

NCC bank Ltd.

I am also owed to each person who I bothered inside and outside of NCCBL Kawran

Bazar Branch, in carrying out this report.



Executive Summary

The report emphasize on the “Deposit and Loan Products Of National Credit and

Commerce Bank Limited’’ highlights the wide range of banking and financial activities

to individuals , firms, corporate bodies and other multi national agencies as well as

products and services offered by the bank to its customers in order to maintain quality of

service.

Bank activities can be divided into three categories. These are general banking activities,

credit or loan advance activities and foreign Exchange activities. Credit or loan and

advance activities do the most important works of the bank. It also plays a vital role in

deposit mobilization. Bank’s main task is to collect deposit from surplus unit and

provide loan to the deficit unit. Credit division is the heart of the banking system as is in

NCC which is responsible for the allowing all the credit facilities given to the potential

customers. Lease financing , Micro credit, and cash credit are the most given credits of

this bank which played a important role in expanding lending base and in increasing

income.

This report contains four chapters. The first chapter of the report describes the

introductory words of the internship report in which Introduction of topic, Objectives of

the study, Significance of the study, Methodology and Limitations. The second chapter

contains the overview of NCCBL. Chapter three contains learning part of the study.

Different suggestions, findings, recommendations and conclusion have come at the end

of the report in the chapter four. The problems findings during the three months long

internship period & suggestions are given from observation. To increase the efficacy in

customer service NCCBL should try to develop the process of providing services.

NCCBL has passed a long way since it is providing services. Already it has earned a

strong position in the field of customer service. To continue or to hold the position and be

perfect in this sector it will have to keep more and more attention to the customer

retention and development.



Table of Contents

Sl. No. Particulars Page No.

Letter of Transmittal i

Disclaimer ii

Certificate of Approval iii

Acknowledgement iv

Executive Summary v

CHAPTER- 1 : INTRODUCTION 1-4

1.1 Introduction 2

1.2 Origin of the Report 2

1.3 Objectives of the Report 3

1.4 Scope of the Study 3

1.5 Methodology 3

1.6 Limitations 4

CHAPTER- 2 : AN OVERVIEW OF THE NCC BANK LTD. 5-10

2.1 Historical Background of NCCBL 6

2.2 Conversion of NCL into NCCBL 6

2.3 Business Operation 7

2.4 Mission 7

2.5 Vision 7

2.6 Objective of the NCCBL 7

2.7 Hierarchy of NCCBL 9

2.8 Division of NCCBL 10

CHAPTER- 3 : LEARNING PART 11-46

3.1 Products & Services of NCCBL 12

3.2 Concept of Deposit 13

3.3 Concept of Loan 24

3.4 Credit Investigation 25

3.5 Principles of Sound Lending 27



3.6 Modern Concept of Good Lending 29

3.7 Analysis of the Depth or Risk Allied with Each & Every

Credit Proposal

30

3.8 Different Types of Loans and Advances offered by

NCCBL

31

3.9 Bank Guarantee 36

3.10 Product of Loans of NCCBL 39

3.11 Different Lending Rates of NCC Bank Limited 43

CHAPTER- 4 : FINDINGS & RECOMMENDATIONS 47-48

4.1 Findings 48

4.2 Recommendations 49

Conclusion 50

Bibliography 51



CHAPTER: 1

INTRODUCTION



1.1 IntroductionA bank is the financial institution that deals with money. Banks do many things that are

not included in the functions of offering deposit and loan services. They provide trust

services, arrange mergers and acquisition, and guarantee payment from one party to

another through letters of credit and other devices. Mainly bank is a commercial

organization and commercial banks are profit-making institution that collects deposits

from the surplus unit of the society. The commercial banks act as the financial

intermediary. As banks are profit earning concern; they collect deposit at the lowest

possible cost and provide loans and advances at higher cost. The functions of commercial

banks have changed as the need of the economy has changed.

Now a day there are various kinds of financial services are being performed and practiced

in modern economy and many of them are very much helpful and up to dated to boost up

the economy of today’s world. And we know one thing that changed the financial

activities today marvelously that is technology. Technology has given commercial sectors

a lot of opportunities to move forward rapidly and smoothly and to satisfy the people by

providing their real time functionalities. As a result there is opened a new era of banking

which is called ‘on-line banking’ are very much popular today which eventually made

possible to building up today’s ‘e-commerce’. So we should introduce such technology

into where the economy is weak to survive.

1.2 Origin of the Report

This report is prepared as partial requirement of the three-month internship

program for BBA program. I took the opportunity to do my internship in the National

Credit and Commerce Bank Limited (NCCBL). In the report I have mainly given

concentration on “Deposit and Loan Products of NCCBL”, which is assigned by

the Human Resource Division of NCCBL. My faculty supervisor Mr. Rafiqul Islam,

Professor & Advisor, Faculty of Business & Economics, Daffodil International

University, also approved this topic.



1.3 Objectives of the ReportThere are certain objectives to carry out this report, these are -

1. To identify the lending procedures maintained by NCCBL.

2. To identify various types of deposit and loan products of NCCBL.

3. To identify some problems and provide suggestions related to Deposit and Loan

products of NCCBL.

1.4 Scope of the StudyScope means area of operations or field of the study. The report focuses upon the Deposit

and Loan Products and the organizational structure and the financial services offered by

NCCBL.

1.5 MethodologyThe report is Descriptive in nature. Data used in this report have been collected from both

primary and secondary sources. Regarding the organizational part, information required

was collected within the organization from the different departments National Credit and

Commerce Bank Ltd.

The primary sources are as follows:

1) Face to face conversation with the respective officer of the branch.

2) Exposure on different desk of the bank.

3) Relevant file study as provided by the officers concerned.

The Secondary sources of data and information are:

1) Annual Reports of NCCBL.

2) Different Books, articles, compilations etc. regarding general banking functions,

foreign exchange operations and credit policies. Table and chart



1.6 LimitationsThere were some problems while I am doing internship. A whole hearted effort was

applied to conduct the internship and to bring a reliable and fruitful result, in spite of

having the wholehearted effort, there exit some limitations, which acted as a barrier to

conduct the program.

The limitations were noted to this page:

Bankers don’t want to disclose all the information I need.

Although the officers of the National Credit and commerce Bank Ltd. have been

very helpful, they didn’t have enough time to provide, as they are very busy with

their assigned works. So, in some cases observation was needed.



CHAPTER: 2

AN OVERVIEW OF THE NCC

BANK LTD.



2.1 Historical Background of NCCBLThe banking system plays a critical role in underpinning economic development. Against

the background of Financial Sector Reform Policies in Bangladesh, National Credit and

Commerce Bank Ltd. has resulted in great success in all areas of operation with a view to

improve the socio-economic development of the country. National Credit and Commerce

Bank Limited emerged as bank in the country on 17th May 1993 out of a great turbulent

situation encountered by erstwhile National Credit Limited. However, the institution

survived the ordeals and came out as full-fledged commercial bank. The company raised

its authorized capitals to tk.750 millions as per guidelines set out by the Bangladesh

Bank. The paid up capital was fixed at tk.390 million of which 50% the sponsor and the

balance 50% of public have paid up i.e. tk.195 million in cash. The sponsors of the new

bank consisted of 26 (Twenty six) Members, who comprised the first Board of Directors

2.2 Conversion of NCL into NCCBLPrior to conversion into a schedule bank, National Credit Limited (NCL) was

incorporated as public limited investment company in Bangladesh on 18th November

1985. It made its journey with a modest beginning on 25th November 1985 at its

registered office and first branch at 7-8 Motijheel Commercial Area, Dhaka-1000. The

initial Authorized Capital of the company was Tk. 30 (Thirty) crore consisting of 30

(thirty) lac ordinary share of Tk. 100 each. A new era of opportunities in the field of

activities was opened for the business. NCL made careful journey and maintained its

successive growth for the few years with its qualified professional management under

most unpredictable, unregulated, uncertainties and limitation.

Then it emerged as a National Credit and Commerce Bank is a progressive commercial

bank in private sector in Bangladesh. It creates new opportunities for its clients. It gives

customized services and maintaining harmonious banker-clients relationship. It provides

different types of commercial banking services to the customers of all strata in the society

within the stipulation laid down in the Bank Company Act 1991 rules and regulation

framed by the Bangladesh Bank from time to time.



2.3 Business OperationNational Credit and Commerce Bank Limited emerged as Bank in the country on 17th

May 1993 out of a great turbulent situation encountered by erstwhile national credit

limited. However, the institution survived the ordeals and came out as full- fledged

commercial bank. The company-raised its authorizes capital to Tk. 750 million as per

guidelines set out by the Bangladesh Bank. The paid up capital was fixed at Tk. 390

million of which 50% the sponsor and the balance 520% for public have paid up i.e. Tk.

195 million in cash.

2.4 Mission“To mobilize resources from within to contribute to development and growth of the

country and also to play a catalyst a role in the formation of capital market”.

2.5 Vision

To be in the forefront of national development by providing all the customers

inspirational strength, dependable support and the most comprehensive range of business

solutions, through our team of professionals who work passionately to be outstanding in

everything we do.

2.6 Objective of the NCCBLThe objective of the organizational structure and corporate governance of NCCBL is to

establish a strong, customer- oriented and transparent management. They constantly

focus on understanding and anticipating customer needs. As the banking scenario

undergoes changes so is the bank and it repositions itself in the changed market

condition. The main objectives of NCCBL are as follows:

To conduct banking business.

To establish a good and cordial relationship between the bank and the

customers.

To invest in various profitable sector to assist the boosting up the

industrial sectors.

To extend its hands to uplift the economic condition of the country.

To rise the living standard of the people providing various schemes.



To develop the human resources it acts consciously.

To make employment.

To ensure safety of the customer’s assets and deposit.

To advise on financial matter to the new entrepreneur.

To invest its capital in the potential sector.


Sr. Vice President & Branch Manager

Sr. Asst. Vice President

Asst. Vice President

Senior Principal Officer

Principal Officer

Senior Officer

Officer

Officer Grade –I

Officer Grade –II

Provisional Officer

Junior Officer

Staff

Guard

Postman

Tea Boy


2.7 Hierarchy of NCCBL



2.8 Division of NCCBLCurrently there are eight divisions and two cells in the band. Each division is charged

with specific tasks and the cells provide necessary support in performing the tasks.

[a].International Division: Transactions related to import-export financing involving

foreign currency.

[b].Credit Division: Appraisal of loan proposal within the country and recovery of loans.

[c ]. Establish division: All establishment related responsibilities.

[d].Board Division: Performing all accounting functions.

[e].Central accounts Division: Performing all accounting functions.

[f]. Human Resources and Administrations division: All administrative and human

resource related works.

[g]. Marketing and Branch Division: Marketing of products and supervision of

branches.

[h]. Audit and Inspection Division: Internal audit and inspections for internal control.

Recovery cell helps credit division in recovery of overdue loans and computer cell

maintains all information necessary for managements.

Like all other commercial bank NCCBL actively participates in deposit mobilization,

loan disbursement, making investment in Govt. securities NCCBL also offers Islamic

Banking to its customers.



CHAPTER: 3

LEARNING PART



3.1 Products & Services of NCCBLDeposit products:

1. Current A/C

2. Savings bank deposit A/C

3. Special notice deposit A/C

4. Term deposit A/C

5. Premium term deposit A/C

6. Instant earnings term deposit

7. Special savings scheme

8. Money double program

9. Money triple program

10. NCC Bank Youngster Money plant Scheme

11. NCC Bank Youngster Account

12. NCC Bank Youngster Maximums Account

Loan and Advanced Products:

1. Working Capital Finance

2. Commercial and trade finance

3. Long term capital finance

4. House and consumer finance

5. Retail and consumer finance

6. SME finance

7. Agricultural finance

8. Import & Export finance

Retail / consumer loan product:

1. Personal loan

2. Car loan

3. Education loan

4. House building loan

5. Consumer finance scheme



6. House repairing & renovation loan

7. House improvement loan.

SME Banking:

1. Small Business Loan

2. Lease finance

3. Working capital Loan

4. Festival business Loan

5. Festival personal Loan.

Cards:

1. Credit cards

2. Debit cards

3. mBridge cards

Remittance product:

1. Wage earners welfare deposit pension scheme

2. Overseas employment loan scheme

3. Special interest rate on deposit & loan.

3.2 Concept of DepositDeposits are the foundation on which banks thrive and grow. They are a unique item in a

bank’s balance sheet that distinguishes it from other types of business firms. Deposits

provide most of the raw material for bank loans and, thus, represent the ultimate source

of bank profits and growth. Deposits generate legal reserves, and it is out of the excess

legal reserves a bank holds that new loans are created. Important indicators of

management effectiveness in any bank are whether or not deposited funds have been

raised at the lowest possible cost and whether enough deposits are available to fund those

loans the bank wishes to make.



Deposit Product of NCC Bank LimitedSTD is renamed as SND as per Bangladesh Bank Instruction

Nature : 100% Time Deposit. Account holder can withdraw their deposits with prior

notice to the bank.

Target group: Any businessman, firm, limited companies, local bodies, corporation,

corporate bodies, joint stock companies etc.

SND account may be opened in the name of corporation bodies, joint stock companies

and also in the name of adult individual or jointly who is/are mentally sound.

Current Deposit (CD)Name: 100% Demand deposit account holder can withdraw their deposit frequently

without any limit.

Target Group: Any businessman, firm, limited companies, local bodies, corporation,

corporate bodies etc.CD account may be opened in the name of firm, corporate bodies,

joint stock companies and also in the name of adult individual or jointly who is/are

mentally sound.

Savings Bank Deposit (SB)Nature: Hybrid 10% is demand and 90% is time deposit. Account holder can withdraw

their deposit twice in a week up to a certain limit.

Target Group: Any Businessman, firm, limited companies, local bodies, corporation,

corporate bodies etc. Savings bank account may be opened in the name of Club,

Association, Society and similar institutions and opened in the name of Adult individual

or jointly who is/are mentally sound. It also be open in the name of illiterate persons and

minor after observing/completion of necessary formalities.

Condition

In case of savings bank A/c the depositor(s) may withdraw money from the

account twice in a week and may withdraw money up to 25% of the balance

without notice but withdrawal money exceeding 25%,07(seven) days notice is



required. If the depositors persistently withdraws more than twice in a week or a

sum exceeding 25% of the balance in the account without notice. The depositors

will not get interest for that month.

If the balance is turn down in below Tk.500 at any day of a particular month then

he will not get interest for that month.

Considering the deposit amount of the first 6th date of each month, interest will be

paid on the minimum balance of the said month as per prescribed rate on June and

December of each year.

Required documents (CD/SND/SB)Individuals account/Joint accounts

Photographs of the applicant(s)

Photographs of nominee

Copy of photo ID-NID/DL/Passport

Proof of address-copy of utility bills/physical verification etc

Partnership account

Letter of partnership

Partnership deed

Company account

Certified true copy of certificate of incorporation or equivalent, details of the

registered office, and place of business.

Certified true copy of the memorandum and articles of association, or by laws of

the client

Copy of the board resolution to open the account relationship and the empowering

authority for those who will operate any accounts.

List of directors.

For public limited company

Certified true copy of certificate of commencement

The above document are mainly common documents, Additional documents is

required when and where is applicable.



Special Deposit Scheme (SDS)Tenor: 03(Three) years

Nature: 100% Term deposit, account holder can withdraw their deposit (principle

amount) after expiry of maturity of deposit.

Amount: Minimum Tk. 1,00,000.00 and its multiple

Rate of interest: 13.40% p.a.

Monthly: Tk. 1,116.00 per month from per inc.

Interest/dividend: (Income tax levied by the government on interest against bank

deposit shall have to be borne by the depositors and that amount to be realized from the

monthly dividend/interest.

Target Group: Any individual person, businessman, firm, limited companies, local

bodies, corporation, corporate bodies etc.

Loan facility: In case lending against pledge of SDS receipt, interest at 16.50% have to

be charged against loan outstanding. This interest rate is fixed and applicable in all cases

without further consideration.

Payment of first: The duration of time between deposit and payment of first

dividend/interest must be

Dividend /interest minimum 30(Thirty) days.

Mode of payment of monthly dividend: Paid in cash or transferred to SB/CD A/C of

the depositors as per instruction.

Premature encashment

Before 01(one) year After 01(one) year but

before 02(two) years

After 02(two) year but

before 03(three) years

Depositor will not be entitled to

get monthly dividend/interest so

amount of dividend/interest paid

earlier shall have to be adjusted

from the net amount payable

Prevailing interest rate of

SB A/C

Prevailing interest rate of SB

A/C + 0.5%



Fixed Deposit Receipt (FDR)Tenor: 3 months, 6 months, 1 years, 2 years

Nature: 100% Time deposit, account holder can withdraw their deposit after expiry of

maturity of FDR A/C

Minimum Deposit: Tk. 50,000.00

Rate of interest: 3 months 12.5%, 6 months, 1 year, 2 years 11%.

Target Group: Any individual person, businessman, firm, limited companies, local

bodies, corporation, corporate bodies etc.

Loan facility: In case of lending against lien of FDR account, interest at the rate of 3%

above has to be charged outstanding. This interest rate is and applicable in all cases

without further consideration.

Special Savings Scheme (SSS)Tenor: 5 years and 10 years

Nature: 100% term deposit. Account holder can withdraw their deposit after expiry of

maturity of deposit.

Amount: Minimum Tk. 500/month or multiple, Maximum 25000/month

Rate of interest: 13.00% p.a.

Maturity value of monthly deposit of Tk. 500: After 5 years (Tk. 41,400), After 10 years

(Tk. 1,15,900)

Target Group: Any individual person.

Loan facility: Loan may be allowed 80% of the deposited amount after 3 years. Interest

will be charged 3% above of the said SSS rate.

Penalty for failure to deposit installment in due time: @2% per month per installment

(On due installment)

For issuance of duplicate deposit book: Tk. 100 each book.

Premium Term DepositPeriod: 2 years (Fixed)



Nature: 100% term deposit. Account holder can withdraw their deposits after expiry of

maturity of Deposit.

Amount: Tk. 10.00 lac and above but multiple of Tk. 1.00 lac.

Rate of interest: 1% + existing rate of 12 month FDR.

Payment of Interest: Interest to be paid on maturity after deducting necessary

charges/levies at simple rate. i.e. at the end of each year interest will not be accumulated

with the principal amount.

Target Group; Any individual corporate bodies, Trustees of provident fund/Benevolent

fund etc.

Loan facility: Loan may be allowed against lien of receipt up to 80% of the face value,

interest at the rate of 3% above has to be charged outstanding. This interest rate is and

applicable in all cases without further consideration.

Death of account holder: Due money shall be paid to nominee/legal heirs.

Post nature encashment: No auto renewal or no extra benefits for post mature

encashment.


Before 1 year After 1 year but before 2 years

No interest on the deposited

amount. Only principal

amount to be paid to the

customer.

Existing FDR rate for 12 months after deducting

taxes/levies.

Instant Earning Term Deposit (IETD)Period: 1 year (Fixed)

Nature; 100% term deposit. Account holder can withdraw their deposits after expiry of

maturity of Deposits.

Amount; Tk. 1.00 lac and above but multiple of Tk. 1.00 lac.

Rate of interest: Existing rate of 12 months FDR-1%



Payment of interest; Interest to be paid to the customer account after deducting

necessary charges/levies etc, at time of accepting deposit. For the purpose customer will

have to open/maintain account relationship with the branch.

Target Group; Retired personnel, housewives, widow and wagge earners

Loan facility: Loan may be allowed against lien of the receipt upto 75% of the face

value, interest at the rate of 3% above has to be charged outstanding.

Death of account holder; Due money shall be paid to nominee/legal heairs.

Post mature encashment: No auto renewal or no extra benefit for post mature

encashment.

Premature Encashment

Before 6 months After expiry of 6 months

No interest on the deposited amount but

interest already paid at the time of opening

account will be realized /deducted from the

principal amount.

Interest will paid at existing STD rate and

interest already paid at the time of opening

account will be realized/deducted from the

principal amount.

Money Double Program

Tenor of the product: 5.5 years that will make the principal amount double on maturity.

Nature: 100% Term deposit. Account holder can withdraw their deposit after expiry of


Amount: Tk. 1.00 lac(minimum) and its multiple.

Rate of interest: 13.40% p.a. effective from 1st July, 2012, interest to be kept in

provision A/C until maturity. Interest to be paid/credited into the a/c only at maturity.

Loan facility: Loan may be allowed against MDP receipt up to 80% of the face value at

an interest rate of 16.50% p.a. following other rules and regulation applicable for

SOD(FO).


Before 1 year No interest will be paid

After 1 year but before 2 years Prevailing interest rate of SB A/C



After 2 years but before 3 years Prevailing interest rate of SB A/C + 0.50%

After 3 years Prevailing interest rate of FDR for 2 years.

Note: No auto renewal and no extra benefit for post mature encashment.

Money Triple ProgramTenor of the product: 9 years that will make the principal amount triple on maturity.

Nature: 100% Term Deposit. Account holder can withdraw their deposits after expiry of


Amount: Tk. 1.00 lac(minimum) and its multiple.

Rate of interest: 13.05% p.a. effective from 1st July, 2012, interest to be kept in

provision A/c until maturity. Interest to be paid/credited into the a/c only at maturity.

Loan facility: Loan may be allowed against MTP receipt up to 80% of the face value at

an interest rate of 16.50% p.a. following other rules and regulations applicable for

SOD(FO)


Before 1 year No interest will be paid

After 1 year but before 2 years Prevailing interest rate of SB A/C

After 2 years but before 3 years Prevailing interest rate of SB A/C + 0.50%

After 3 years Prevailing interest rate of FDR for 2 years.

Note: No auto renewal and no extra benefit for post mature encashment.

NCC Bank Youngster Money plant SchemeNature: It is basically a recurring deposit account for school and high school going

students of Bangladesh with added values and benefits.

Age: Any Bangladeshi student enrolled in an enlisted school or high school with

Bangladeshi government within the age of 18 years but on maturity date the age of the

applicant must below 18 years

Authentication: Photographs of account holder and parents/legal guardian is attested by

school authority.



Rate of interest: Average rate is 12.62% p.a. Interest will be calculated as regular as

SSS.

Installment size: Minimum monthly installment is BDT 250 and Maximum is BDT

10,000.

Maximum Number of account: One can open maximum 5 YMS of different or same

installment amount in account holder’s name or in joint name with account holder’s

sibling’s name provided sibling must know how to writhe his/her own name.

Maturity tenure: 5/8/10 years but the maturity period shall not exceed up to the age of

18 years of account holder

Penalty for default installment: 2% of the installment size or minimum Tk. 10

Premature encashment: Before 6 month no interest will be paid.

Nomination of legal guardian: Guardians name and signature must be attested by both

of the parents on BDT 150 non judicial stamp and notarized.

Nominee: Mandatory and selected by both of the parents or legal guardian.

Transfer of matured value: Respective youngster account, But after completion of 18

years of the account holder.

NCC Bank Youngster Maximums AccountNature: 100% Term Deposit. It is basically a fixed deposit account for school and high

school going students of Bangladesh with added values and benefits.

Age : Any Bangladeshi government within the age of 18 years but on maturity date the

age of the applicant must below 18 years.

Rate of interest : Published 1 year FDR rate + 0.25% p.a.

Amount : Minimum BDT 5000 and its multiple but maximum BDT 1,00,000

Maturity tenure : Minimum 3 years but the maturity period shall not exceed up to the

age of 18 years of account holder.

NCC Bank Youngster AccountNature: It is basically a savings account for school and high school going students of

Bangladesh with added values and benefits.\



Age: Any Bangladeshi student enrolled in an enlisted school or high school with

Bangladeshi government within the age of 18 years.

Rate of interest: 6.00% p.a. No daily basis and charged on half yearly basis.

Opening deposit: Initial deposit not less than BDT 100

Account Continuation balance: Zero balance not allowed.

Minimum Deposit: Not less than BDT 50 and maximum any amount.

Annual service charge: Free.

Withdrawal: Any number of withdrawal and fund transfer is allowed.

Documents required opening any youngster account

School attested photograph of applicant and both the parents.

School enrolment proof.

Both the parents attested photograph of nominee.

Copy of birth certificate of the applicant.\

National ID Card/ passport/driving license of both the parents or legal guardian.

Birth registration certificate of the nominee.

NATIONAL CREDIT AND COMMERCE BANK LIMITED

MARKETING AND BRANCHES DIVISION

HEAD OFFICE, DHAKA

Instruction Circular No. 544/2014

All divisions/Departments/All branches of

NATIONAL CREDIT AND COMMERCE BANK LTD.

SUB: RATE OF INTEREST ON DEPOSITS AND IBTA

Further to our instruction circular No. 544/2014 dated 25-03-2014 regarding rate of

interest on deposits and IBTA. We have to inform that as per discussion held in the 111th

meeting of Assets Liability Management Committee (ALCO) held on 20 th April, 2014 the

rate of interest on Fixed Deposit and IBTA has been revised. Upon change of interest rate



on Fixed Deposit and IBTA, the effective rate of interest on Deposit and IBTA from 1st

May, 2014 are furnished below for information of all concerned.

SL

No.

Category of Deposits/Account Existing Rate of

Interest

Revised Rate of

Interest

01 Savings Bank Account 6.00% 6.00% (Unchanged)

02 Special Notice Deposit (SND)

i)For less then Tk. 1.00 crore 6.00% 6.00% (Unchanged)

ii)For Tk. 1.00 crore to below

Tk.25.00 crore

6.50% 6.50% (Unchanged)

iii) For Tk. 25.00 crore to below

Tk.50.00 crore

7.00% 7.00% (Unchanged)

iv) For Tk. 50.00 crore to below

Tk.100.00 crore

7.50% 7.50% (Unchanged)

v) For Tk. 100.00 crore and above 8.00% 8.00% (Unchanged)

03 Fixed Deposit

For 1 (one) months 8.00% 8.00% (Unchanged)

For 3 (Three) months

Up to Tk. 1.00 crore

10.50% 10.00%

Above Tk. 1.00 crore 10.50% 9.50%

For 6 (six) months


10.50% 10.00%

Above Tk. 1.00 crore 10.50% 9.50%

For 12 (tweleve) months


10.25% 9.75%

Above Tk. 1.00 crore 10.25% 9.25%



For 24 (twenty four) months 10.00% 9.50% (Unchanged)

04 IBTA Interest

IBTA (Debit Balance) 11.00% 10.00%

IBTA (Credit Balance) 11.50% 10.50%

(Unchanged)

The effective date of above Rate of Interest on deposits and IBTA is 1st May, 2014.

3.3 Concept of Loan

IntroductionThe word “CREDIT” is derived from Latin word “credo” that means ‘I believe’. Bank

lending is important for the economy in the sense that it can simultaneously finance all of

the sub-sectors of financial arena, which comprises agriculture, commercial and industrial

activities of a nation. Lending of money to different kinds of borrowers is one of the most

important functions of commercial bank. Not only this it is the most profitable business

of the commercial bank and the major source of income but lending is a risky business.

The nature of their activities, the location of business, financial stability, earning and

repayment capacity, purpose of advance, securities all differ and their degree of risk also

differ. Although all lending involve risk yet a bank as to go with it for earning profit and

economic up liftmen as well. But the fact is this while going on lending; a bank should

be careful in selecting a borrower and must give paramount importance to it. This may

ensure safety of the lending of a bank.

What are loan Credit?Credit is a promise of future payment in kind or in money given in exchange for present

money, goods or services”. In general credit means the granting of a period of time by a

creditor to a debtor at the expiration of which the latter must pay the debt due.



Importance of advance towards the nationLoan & advance is an important part of a bank. Deposit extraction & credit extension is

the basic function of a Bank. Proper credit management is the crying need for a Bank. So

every Bank follows some policy of direction, monitor, smooth approval & review of

lending operation for the proper credit management. NCCBL extent it credits facilities to

trade & commerce, small & medium enterprises within the policy guidelines of the Bank

& Bangladesh Bank.

3.4 Credit InvestigationCredit Investigation refers to the assessment of the loan

proposal/venture/project/enterprise from different angles with a view to justifying

soundness of the same.

Who shall get credit?

It is easier to find out a depositor than finding out a good borrower. Public money, in the

hands of bad borrower, is never saved and secured. Then, whom to lend? In short, the

answer is to lend to an entrepreneur. Who is an entrepreneur? An entrepreneur may be

defined as a person who, for attaining his own pecuniary interest as well as mental

satisfaction together with offering additional services and well being to the society at

large, under takes efforts to collect together various types of necessary goods, labor

materials, other wealth etc. and by means of application of his wisdom, foresight,

creativity, devotion and self confidence, takes initiative to add additional utility and

value to the collected materials and wealth by bringing change and or modification in

their form. He manages affairs and loan sanctioning authorities must be acquainted with

technique to take correct lending decision so far borrowers attribute is concerned.

Sources of Credit Information

Broadly, a banker collects the required information about a prospective borrower from

the following sources:



Loan Application

When a loan proposal has to be processed a banker first studies the loan application made

by the borrower. A loan application usually contains information pertaining to the name

of the concern, constitution, nature and place of business, year of establishment,

borrower’s experience in the line, particulars of assets and liabilities, purpose of advance,

amount required, the period of advance applied for, nature of security offered, sources of

repayment etc.

Market Reports

After receiving the loan application form, NCCBL sends a letter to Bangladesh Bank of

obtaining a CIB (Credit Information Bureau) report. The purpose of this report is to being

informed that borrower has taken loan from any other bank, if ‘yes’ then whether these

loans are classified or not. After receiving CIB report if the bank thinks that the

prospective borrower will be a good borrower, then the bank will scrutinize the

documents. If all the documents are properly filled up and signed then comes processing

stage. In this stage, the bank will prepare a credit proposal.

Study of Account

If the borrower is the customer of the bank, a study of the borrower’s account and his /her

past dealings will throw light on the aspect of keeping up commitments, borrowing else-

where etc. which will assist a banker in judging about creditworthiness of the borrower. If

the account shows a good turnover, and the cheques were never returned for want of

funds, which will give an impression about the volume of business of the borrower as

well as his/her honest dealings. If some of the parties to whom cheques are issued are

known to the bank, further independent enquiry would be possible. If he/she is having

account with other bank, he/she may be requested to show the relative passbook and/or

statement accounts so that all accounts can be studied side by side. A confidential opinion

about the customer from his/her pray bankers should be obtained.



Financial Statements etc.

The borrower should be requested to supply the statement in regard to his/her assets and

liabilities. It is always preferable to have audited statements for the last three years. In

addition, the lending banker must arrange to obtained a copy of the latest income tax

statement of the borrower from which it will be possible to estimate his/her income.

Similarly his/her sales tax return will give an idea about the sales. In case of limited

companies, the audited balance sheet and profit and loss account for the last three years

must be obtained to assess the financial position of the company and various financial

aspects of the borrower’s business.

Other Sources

Other sources of information about the borrower include press reports regarding purchase

and sales of property, Auctions and decrees, registration, revenue and municipal records

can also be referred to with advantage to verify the properties owned by the borrower and

charges thereon, if any. If the borrower happens to be a limited company, a search of the

records of the registrar of the joint stock companies should be made for finding out if

there are any prior charges or mortgage on the company’s assets.

Personal Interview

After having collected all the information from outside sources, it is advisable to arrange

for a personal interview with the borrower. The questions must be suggestive and helpful

to put him/her at ease so that he/she gives all information required by the bank. The

banker should be able to know from the interview the customer’s specific requirements,

the prospects of his/her employing the funds prudently, his/her capacity to repay and the

suitability of the security offered, if any. Enquires may be made to verify the information

given by the customer.

3.5 Principles of Sound LendingLending of money to different kinds of borrowers is one of the most important functions

of NCC Bank Limited. Not only this is the most profitable business of the bank and

major sources of income but lending is a risky business. Risk involvement may be kept at



minimum, if sound lending principles are followed. To do the lending business profitable

the following principles may be followed.

Purpose: Another important point to be studied by a banker before lending is the purpose

for which the loan is required and also the resources from which the borrower is expected

to repay. The purpose of loans helps the banker to determine his/her course of action as

regards lending. Bank should avoid making loans for unproductive purpose and

speculative activities.

Liquidity: Liquidity of money lent is another important principle of lending. Liquidity

means availability on readiness of bank funds on short notice. The liquidity of loan

means its repayment on demand on due date or after a short notice. Liquidity also means

conversion of assets into cash without loss or with insignificant loss.

Security: Security is another principle of sound lending which serves as the safety valve

for an unforeseen emergency. Not only this, the security accepted by a banker to cover a

bank advance must be adequate, readily marketable, easy to handle and free from any

encumbrances.

Profitability: Commercial banks obtain funds from Shareholders and if dividend is to be

paid on such Shares it can only be paid by earnings profits. This is not possible unless

funds are employed profitably. So the banker should not enter into a transaction unless

affair return from it is assured.

Spread/ Diversification: Advances should not be gives in one particular

area/industry/activity are one on few borrowers because any adversity faced by that

particular sector will have a serious adverse affect on the bank. So there should be

diversification of advances its risks and considerably look into the safety of its advances.

Here the principle is “Do not put all the eggs in the same basket.”



National interest/Social interest: Bank has a significant role in the economic

development process of a country. They should keep in mind the national development

plan/program while going for lending lent maintaining safety, liquidity and profitability.

3.6 Modern Concept of Good LendingModern concept of lending presupposes a well-developed loan proposal/loan

case/project. It will cover as many as six pertinent aspects like:

Managerial aspect- Character, Capacity, Capability of management.

Organizational aspect- whether proprietorship or partnership.

Technical aspect- Location of project, power, construction.

Marketing aspect- Marketability of the product.

Financial aspect- cost of project, sources & uses of funds profit.

Economic aspect- Socio economic benefit and cost analysis.

How much to lend:

Over financing and under financing are vary common phenomenon in credit portfolio;

neither of which is desirable as a sound principle of advance. For a going concern, widely

accepted principle of calculating working capital need is already and established factor of

sound credit policy deviation from which may lead to catastrophic result and so, it is

better to reject proposal instead of under financing. At the same time, over financing will

create opportunity to divert fund. The highest priority of consideration is that bank credit

must not be extended for speculative purpose and sound credit policies always find out

actual credit need depending on nature, volume, and turnover of business as well as

capability of the prospective borrower. The most important aspect for consideration is

how much a bank can lend taking in consideration its liquidity position, loan able fund

and commitment already made. Moreover contingent liability must be taken in to

consideration very wisely in sanctioning new loan and enhancing old limits as contingent

liability.

Purpose of Lending:



The recommending as well as sanctioning authority must ascertained and satisfy himself

that all advances are for productive purpose, genuine business and tread-need based and

neither for speculative nor for unproductive purpose. Here production is to be construed

as creation of additional utility for the society. Thus, if advance is canalized for

productive purpose, it will broaden economic activity, augment trade and commerce,

production will rise, open the door off new economic activity, create employment

opportunity, encores young energetic millions to engage themselves in innovative

remunerative activity, and increased movement of goods and flow of cash i.e., velocity of

circulation of money will automatically be increased which, in banking concept, is known

as cash generation. Bank cannot afford a loan turning bad to the detriment of institution

and the society and for this purpose, the recommending and sanctioning officer must be

acquainted with sound principles of advance, and the ways and means to analyze the risks

involved with the proposal processes and the limit sanctioned.

3.7 Analysis of the Depth or Risk Allied with Each & Every Credit

Proposal.

Main Points of analysis are as follows:

Lending risk analysis:

Since lending involves risk, the primary concern of branch manager/ sanctioning

authority must be to assess the relative risks of loan and advance so as to minimize

possibility of loan losses by identifying the weak/ risky areas of a proposal/loan and side

by side will also point out the areas of strength and profitably.

Lending risk analysis, a new management and operational tool for improving operational

and judgment efficiency of bank, has been initiated by financial sector reform project

(FSRP) with following points in view:

a) The banking system channels scarce financial resources into those opportunities with

maximum return.

b) Profitable enterprise receives fund and grow.



c) Loss making enterprise is refused funding and goes out of business.

d) The bank makes profit and pays tax.

e) The CAMEL standard of bank is raised.

f) The economy grows and people are benefited at large.

3.8 Different Types of Loans and Advances offered by NCCBL1. Funded Credit and Non –Funded Credit

2. Sectoral Classifications:

i. Private Sector- Public Sector

ii. Different Sectoral Activities:

1. Commercial and Industrial

2. Transport

3. House Building, etc.

3. Loans on the basis of terms:

i. Working Capital Finance and Fixed Capital Finance

ii. Fixed Term Loans

1. Short Term : Up to 12 months

2. Medium Term: More than 12 and up to 36 months

3. Long Term: More than 36 months

4. Further Classifications:

i. Clean – Secured

ii. Loan

iii. Overdraft

iv. Cash Credit (Pledge/ Hypothecation)

v. Bills Purchased and Discounted

5. Import Financing:

i. Loan against Imported Merchandise (LIM)

ii. Payment Against Documents (PAD)



6. Export Financing:

i. Pre Shipment Export Credit:

1. Packing Credit (P.C.)

2. trust Receipt (TR)

3. Back to Back Letter of Credit (Inland)

4. Back to Back Letter of Credit (Foreign)

5. Red Clause letter of Credit

ii. Post- Shipment Export Credit:

1. Negotiation of Export Bills

2. Purchase of Export Bills

3. Payment Against Document Sent for Collection

Lending product of NCC Bank Limited1. Working Capital Finance

2. Commercial and trade finance

3. Long term capital finance

4. House and consumer finance

5. Retail and consumer finance

6. SME finance

7. Agricultural finance

8. Import & Export finance

SME Finance

i) Small Business loan

ii) Lease finance

iii) Working capital finance

iv) Festival business loan

v) Festival personal loan



1. Small Business Loan

Eligible Criteria

Minimum 5 years experience

Must have a current account with NCC Bank Limited

Business should be profitable

Criteria of Loan

Product : Term loan, Lease and working capital finance

Selling : Tk. 1.00 lac to Tk. 5.00 lac.

Term : Minimum 1 year to 5 years.

Interest Rate : 17%

Special characteristics : Collateral free up to Tk. 8.00 lac.

Security

Hypothecation of goods and capital machineries

02 Guarantors

Valid Trade License

Calculation of monthly installment under SBLS @17% including one month grace

period:

Amount

Loan

One Years Two Years Three Years Four Years Five Years

One lac 9,250 5,014 3,616 2,926 2,520

Two lac 18,499 10,029 7,232 5,853 5,041

Three lac 27,749 15,043 10,847 8,779 7,561

Four lac 36,999 20,057 14,463 11,706 10,082

Five lac 46,248 25,071 18,079 14,632 12,602



2. NCC Bank Women Enterprise Loan Criteria of loan.

Product : Term loan, Lease and working capital finance

Ceiling : Tk. 1.00 lac to Tk. 50.00 lac.

Term : Minimum 1 years to 5 years.

Interest Rate :

Special characteristics : Collateral free up to Tk. 8.00 lac.

Security

Hypothecation of goods and capital machineries

02 Guarantors

Valid Trade License

Some of them are described bellow

Loan: A Loan is an advance for a fixed amount repayable on demand. The loan amount

is debited once for all. There cannot be any further debit in a loan account except for

interest and other sundry charges.

Bill Discounted

Only bills are discounted. As the bills are payable after 30, 60, or 90 days the party wants

accommodation against those bills. Discounting of bills / promissory note constitute a

clean advance. Banks rely principally on the creditworthiness, standing and means of the

endorser.

Loan against trust receipt (LTR)

The temporary loan, which is allowed to the customer against their application on the

basis of trust. It is call loan against trust receive. Validity of LTR will be allowed for

30/60/90/120 days etc. Adjustment of LTR may be made partially or fully. Interest rate of

this loan is higher. Interest rate on LTR is charged on monthly basis. It is allowed against

security.



Loan against Imported Merchandise (LIM)

The temporary loan, which is allowed to the importer against their imported goods, is

called Loan against Imported Merchandise (LIM). Validity of the LIM will be allowed as

per sanction letter. LIM is generally disbursed once. Interest rate of this loan is higher

and it is charged on monthly basis. Control over the imported goods to be absolutely

maintain by the bank.

Cash credit (Hypothecation)

Hypothecation is a charge on company for a debt, but neither ownership nor possession

passes to the creditors. In hypothecation, both ownership and possession remain with

debtor. The charge is created by the debtor to the lender on his execution of a document.

As the goods remain in the possession of the borrower, banks grant hypothecation facility

normally to first parties. It depends mainly upon the trustworthy of the party.

Advance is generally allowed against hypothecation of the following:

Raw materials

Stock-in-trade

Finished products

Book debt of the debtor

Cash Credit (pledge)

Cash credit allowed against pledge of goods is known as CC (Pledge) limit.

Pledge is bailment of goods or securities.

The bailment must be by the debtor or intending debtor of intending debtor or

his duly authorized attorney.

The goods must be in the possession of the pledge.

Secured Over Draft (SOD)

The overdraft is a kind of advance always allowed on a current account operated upon by

cheques. The customer may be made any number of limits at the convenience of the

borrower, provided the total amount overdrawn does not, at any time exceed the agreed



limit. Interest is calculated and charged only on the actual debit balances on daily product

basis.

Secured Overdrafts (SOD) is four types on the basis of Securities:

1. SOD against FDR

2. SOD against PSP

3. SOD against Scheme

4. SOD General

Payment against Document (PAD)

When Issuing bank gets the original shipping discontents from Negotiating bank against a

letter of credit (L/C), then issuing bank goes through that shipping discernment for

scrutiny. After scrutiny of the shipping documents, if the issuing bank finds the shipping

documents in order, i.e. as per L/C terms, then issuing bank open a loan account on

account of importer. This total process may be defined as Payment against Document

(PAD).

3.9 Bank GuaranteeA contract of guarantee has been defined under section 126 of the Contract Act as “a

contract to perform a promise or discharge the liability of a third party in case of his

default. The person giving the guarantee is called “Surety” or “Guarantor” and the person

on whose account the guarantee is given is called the “Principal Debtor” and the

beneficiary of the guarantee is called the “Creditor”.

Meaning

Issuance of Bank Guarantee on behalf of clients is a common banking service rendered

by commercial bank. Guarantees are expressed commitment to make good of any

financial loss the beneficiary of the guarantee may sustain when the party named in the

guarantee on whose account i.e. the principal debtor, guarantee is issued, fails to perform

the contract and/or discharge his /her obligation under the guarantee. Though the bank

issuing the guarantee is not called upon to pay the amount immediately, the obligation

undertaken in the guarantee is of no less importance than that of actual credit disbursed as



bank is substituting its own credit where its customers credit fails and on demand the sum

guaranteed is payable. It is, as such, a contingent or anticipated financial liability.

Purpose

In keeping with the ever increasing business need of its clients Bank may be required to

issue guarantee against advance payment, in the shape of bid bond, Performance bond,

investment bank guarantee and the like.

Classification: May of three types:

For payment to the creditor or to the principal debtor by the guarantor.

For payment of price of goods sold.

Fidelity Guarantee i.e. to discharge liability of a person for good conduct

of a service holder.

PrecautionBefore issuance, the specimen of the guarantee should be thoroughly examined to

ascertain that is has no ambiguity. The points like (1) the extent of liability (guarantee

amount/ interest/charges of extension etc.) should stand clearly defined. It should also be

ascertained before issuance of the guarantee whether the client would need further credit

facility to enable him to discharge his obligation under the proposed guarantee

particularly for bid bond, performance bond or advance payment guarantee for execution/

completion of any work order project should it be allotted to him. Possibilities of such

eventuality should be explored and examined very carefully before issuing guarantee.

Essentials of a valid Guarantee:

It must satisfy all essentials of a valid contract.

Must be three parties (a) Creditor (b) Principal (c0 Surety all must join in the

contract.

Primary liability is of principal debtor – surety’s liability is secondary i.e. in

case of default of the primary debtor.

Principal debtor may be a minor—contract enforceable between creditor and

guarantor—minor may not pay nor enforceable against him.



Determination of Security

As the bank has to remain prepared for eventuality of issuing a guarantee, payment of

guarantee and creation of forced loan, it is essential that the aspect of security is

considered in its truest perspective.

Application

As and when approached for a bank guarantee by a customer, Manager should ask for

submission of the following papers/information:-

A written request specifying the purpose, amount, period and the security

offered with supporting papers.

The details of security other than cash margin.

Specimen of the guarantee. In case a prescribed specimen does not exist,

a specimen may be drafted to suit the requirement incorporating the

amount, tenor and purpose with bank’s obligation clearly spelled out.

Formalities

While deciding to issue a guarantee, the following should be obtained prior to issuance:

Cash margin as may be determined.

Counter guarantee/ Indemnity signed by the client, duly drafted by the

bank’s lawyer.

Specimen of the guarantee duly approved by the customer.

Incase the Guarantee is covered by any other security other than cash margin which

generally be of following types jointly or severally:

Fixed Deposit Receipt.

Any other financial obligation.

Mortgage of immovable properties.

Bangladesh Bank Rule

As per directive of central bank, in force, besides margin fixed on the basis of banker-

customer relation, the uncovered portion of the guarantee is to be got covered by readily

realizable security.



3.10 Product of Loans of NCCBL Retail / consumer loan products

i) Personal loan

ii) Car loan

iii) House building finance

iv) Consumer finance

v) House repair & renovation

vi) Home improvement loan

1) NCC Bank Personal Loan

A loan facility for the service holders to meet the emergency expenses of the following

occasions

To bear the cost of medical / surgical operation / maternity / marriage

Eligibility of the applicant

Only permanent salaried employees with at least 3 years of confirmed service

Age limit : Minimum age 21 years to maximum 50 years

Loan limit : Minimum BDT 25,000 and maximum BDT 1,00,000.

Loan application fees : BDT 600

Interest Rate : 16%

Loan Tenure : Minimum 6 months but not exceeding 3 years.

Required Document

3 copies of recent passport size photograph of applicants, applicants spouse and

guarantor(s) self attested.

Copy of national ID card of applicant(s), applicants spouse & guarantor(s).

Last one year bank statement of the applicants (personal or company account)

Up-to-date copy of TIN certificate of applicants & guarantors

Utility bill copy (Gas or Electricity)

Accepted budget or quotation



Employers letter of introduction/salary certificate/ salary statement and office ID

card

Calculation of monthly installments under @ 17%

Amount of

Loan

Six

months

One year One and

half year

Two years Two and

half years

Three

years

20,000 3501 1824 1267 989 823 713

25,000 4376 2280 1583 1236 1029 891

30,000 5251 2736 1900 1483 1234 1070

35,000 6126 3192 2217 1730 1440 1248

40,000 7001 3648 2533 1978 1646 1426

50,000 8751 4560 3167 2472 2057 1783

60,000 10502 5472 3800 2967 2469 2139

70,000 12252 6384 4433 3461 2880 1486

80,000 13127 6840 5066 3955 3292 2852

90,000 14002 8208 5700 4450 3703 3209

1,00,00 15752 9120 6333 4944 4115 3565

Table Monthly Installment of PLS

2) NCC Bank Car Loan

A facility to ease the burden of high cost as well as to fulfill the dream of acquiring


Salaried employees at least three years of confirmed service.

Self-employed professionals having at least 3 years of independent practice

experience

Businessperson having at least 3 years business experience



Homeowners or property income holder

Age limit : Minimum age 21 years to maximum 6o years

Loan limit : Minimum BDT 2,00,000 and maximum BDT 20,00,000

Vehicle category : Japanese, Korean, USA, South East Asian and European Origin

Vehicles only.

Loan application Fees : BDT 600

Loan Tenure:

Reconditioned Vehicle : Maximum 60 months

Brand New Vehicle : Maximum 72 months

Required Documents

3 copies of recent passport size photograph of applicants, applicants spouse and

guarantor(s) self attested.

Copy of national ID card of applicant(s), applicants spouse & guarantor(s).

Last one year bank statement of the applicants (personal or company account)

Up-to-date copy of TIN certificate of applicants & guarantors

Utility bill copy (Gas or Electricity)

Accepted quotation of the car

Employers letter of introduction/salary certificate/ salary statement and office ID

card

Copy of professional degree certificate, self declaration on own letter head pad

stating monthly income and membership certificate if applicant or guarantor is a

professional individual.

If applicants or guarantor is a businessman up-to-date trade license.

If the applicants is a property income holder then copy of title deed of rental

property, rental agreement or rent receipt for the last three months.

3) NCC Bank Education Loan

A facility to ease the burden of high cost as well as to fulfill the dream of acquiring

higher education by eligible students.




Any Bangladeshi bonfire student, after successful completion of at least H.S.C

Complied all precondition for getting admission and visa formalities

Have no bad reputation e.g. criminal record, political connection etc.

Loan Limit: Minimum BDT 1,00,000 and Maximum, BDT 10,00,000

Loan Application Fees: BDT 600

Required Documents

Completion of a/c opening formalities including letter of introduction.

Letter of authorization from the student for whom the loan will be availed

Copies of national ID card & TIN of borrower.

Salary/income certificate stating net earning

Copy of passport with valid visa of the student where applicable

Copies of certificate of education of the student

Any other documents that are prudently felt necessary.

4) NCC Bank House Building Finance

Housing is one of the five prime needs of mankind. Everyday has a dream to have a

dwelling house of his own. NCC Bank’s Housing loan with competitive rates, convenient

features and simple procedures will enable you to turn you dream into reality.

Purpose of the loan

Purchases of Flats/House

Construction of building on own land

Extension of building/floors

Who can apply?

Confirmed service holders with at least 3 years service experience employed by a

well reputed organization.

Professionals with minimum 3 years experience with adequate proof.

Business persons with minimum 3 years continuous business performance with

adequate proof.



Feature of the loan:

Loan amount : Tk. 5, 00,000/ to 75,00,000/.

Loan period : 5 years to 15 years

Interest Rate : Competitive interest rate as per Bank’s policy and

Bangladesh Bank

Age of the property : Not exceeding 10 years in case of purchase of ready

house/building

Location of the property : City corporation/pourosava where there is a plan duly

approved by a designated graduate civil engineer duly approved by the appropriate

authority

Duties and taxes are payable as per Govt. rules. Consideration of income of spouse father

& son/daughter, mother & son/daughter is possible. Approval of loan application are

subject to fulfillment of legal, technical and financial requirements as per guidelines of

NCC Bank Housing loan scheme and at the sole discretion of NCC Bank Ltd.

3.11 Different Lending Rates of NCC Bank Limited

Further to our instruction circular no. 447/2012 dated 04.06.12 regarding rates of interests

on different category of lending, interests on several portfolios of loans & advances have

been revised as per approval of the Board of Directors of the Bank in its 282 nd meeting

held on 03.03.2014 with effect from 01.03.2014 as under:

Category/ Head of Advance Existing

Maximum rate

Mid rate Maximum rate

01.Agriculture: (Subject to

BD Banks norms)

a. Fish, crops & other

cultures (except Maize

oilseeds & Spices)

b. Maize oilseeds & Spices

cultures

13.00%

4.00%

-

-

13.00%

4.00%



02.Term loan:

a. Industry:

b. Others (other than

mentioned below):

15.50%

18.00%

15.00%

16.50%

16.50%

18.00%

03.Working Capital to

Industry:

a. Small scale:

b. Large scale:

17.00%

15.50%

15.50%

15.00%

17.00%

16.50%

04. Export: (Pr-shipment

Export credit) 7.00% - 7.00%

05.Commercial Loan:

a. Pledge & Hypothecation

b. Small business loan &

festival small business loan

c. NCC “Nari Shabolombi

scheme”

d.PAD, LIM & LTR

e. Import of essential

commodities as per

Bangladesh Bank circular

f. IBP, LDBP & Bills

Discounted

g. FDBP & Bills Discounted

(Where exchange is earned)

18.00%

18.00%

10.00%

17.50%

15.50%

17.50%

18.00% ( for

overdue period)

16.50%

17.00%

-

15.50%

-

16.00%

16.50% (for

overdue

period)

18.00%

18.50%

10.00%

17.00%

15.50%

17.50%

18.00%

06. Housing Loan:

a. Residential

b. Commercial

17.00%

18.00%

15.50%

16.50%

17.00%

18.00%



07. Consumer Finance:

House repairing / Renovation

loan, Personal loan,

Consumer Finance Scheme

(CFS) & Car Loan

18.00% 17.00% 18.50%

08. Credit Cards: 2.50% per month - 2.50% per month

09. Non Bank Financial

Institute (NBFI) 16.00% 15.00% 16.50%

10.Others:

a. Against FDR, SSS & other

FOs (except SDS, MDDR &

MTP) of our Bank

b. Against SDS, MDDR &

MTP of our Bank

c. Against FDR/FOs of other

banks, ICB unit, WEDB &

share act.

d. SOD (G) against

work/supply order

e. SOD (G) other than

work/supply order

f. SOD (G) Under Earnest

Money Finance Scheme

g. Transport

h. Lease finance

i. STL

j. Time loan

k. Forced loan

l. Education Loan/lien of

A/Cs

*3% above

relevant FOs rate

16.00%

16.00%

18.00%

18.00%

17.00%

17.50%

17.00%

18.00%

17.50%

17.50%

17.00%

-

15.00%

15.00%

16.50%

16.50%

15.50%

15.50%

17.00%

16.50%

16.00%

16.00%

15.50%

*3% above

relevant FOs rate

16.50%

16.50%

18.00%

18.00%

17.00%

17.00%

18.50%

18.00%

17.50%

17.50%

17.00%



*2% above of ROI of FO subject to prior approval from head office for very

selective clients.

Additional 2% interest will be charged on “Excess Over Limit” (EOL), if

allowed & 2% penal interest will be charged on overdue amount.

Approved maximum rate will be considered if otherwise not approved. However,

1% concession may be allowed from maximum rate of interest if approved by

the Managing Director of the Bank.

Changes of rates of interest to be intimated to the respective borrowers.

ConclusionIn line with the policy guidelines issued by the Central Bank from time to time, the bank

formulates its own Credit Policy keeping it flexible to accommodate changes that are

taking place. The Bank has a diversified portfolio consisting of both traditional and non

conventional ones. Several Small Credit Schemes are on the offer, which received

remarkable response from the customer and also helped the Bank to expand its customer

base. The Bank is also considering engaging in syndication with other Banks for allowing

large loans covering Bangladesh Bank’s rules and regulations.



CHAPTER: 4

FINDINGS &

RECOMMENDATIONS



4.1 Findings1. Most of the time the NCCBL tries to provide quality services to the known

clients, it may lose general customers.

2. Process of sanctioning loan is very lengthy. As a result many of the customers are

not willing to take loan.

3. NCCBL ATM services is not good, on the other hand their ATM booths are very

few.

4. Most of the clients think that, the terms and conditions are too hard to take loan.

5. The interest rate of some loan products are high and it’s not capable to compete

with market competition.

6. When the loan amount is small then 1% processing fee is not too much, but for

large scale, 1% processing fee is huge amount. As a result business clients are not

interested to take loan from NCCBL.

7. NCCBL website is not sufficient to provide all information about every type of

loan and deposit products. So, clients need to go to the NCCBL branch to collect

information properly.



4.2 Recommendations

1. The bank should recruit efficient manpower.

2. The bank should introduce batter services for all customers.

3. The bank should introduce new technology based services like Dutch Bangla

Bank.

4. NCCBL should increase their ATM booth and related services.

5. The bank should improve the Credit risk management department for avoiding

possible defaulter.

6. NCCBL should introduce mobile banking like Dutch Bangla Bank & Brac Bank.

7. The bank should improve procedural matters regarding approval, monitoring and

recovery of credit facilities.

8. Detailed Manual should be prepared for accurate deposit and loan operations.

9. The bank should reduce harassments and take a less time for the processing of

loan application.



Conclusion

National Credit and Commerce Bank Limited has started their journey as a full-fledged

commercial bank in 1993. They have already passed twenty long years of their banking

life. This bank constantly looks for ways & means to improve productivity by rendering

batter services to its customers in order to remain competitive in the market.

NCC Bank Limited plays a significant role in various fields in the economy such as

industry, trade & commerce, transportation, deposit mobilization etc. It is playing a

crucial role in human resource development and in creating new employment

opportunities.

NCCBL has to change their marketing strategy according to market situation. They have

to increase their branch network so that they can reach their potential customer.

Technology is one of the most important aspects of banking sector. NCCBL should

expand their online banking service at least for key business areas. This would give

NCCBL huge competitive edge over their competitors & customers will be more satisfied

with their service.



B I B L I O G R A P H Y

Category: Books and Articles

1. Annual report of NCCBL (2010-2011-2012-2013)

2. Donald R. Cooper/Pamela S. Schindler. “Business Research Methods” 9th Edition.

3. Chowdhury, L.R”A Text Book on Foreign Exchange” Fair Corporation, Dhaka-

2000.

4. C.R Kotheri, “Research Methodology” Second Edition, 2003-04, Wishwa

Prakasham, Calcutta, India.

5. Investment Policy and Control Guidelines, Lecture Materials, Official Record.”

6. Hai. M. Enamul. “Bank Management” Jane Publishers, January-1996.

7. K.K. Dewett, “Modern Economic Theory” Shyan Lal Charitable Trust, New

Delhi, 1998.

8. Peter S Rose, “Commercial Bank Management” Richard D. Irwin INC 1991, 5th

Edition.

9. Abu Zaker, S.M. Ethics in Banking, Essay Wining third prize in the year of 2003.\

10. “Banking & Industrial Development: A Case Study of Bangladesh”, Journal of

Business

Category: Web Site

www.bangladesh-bank.org.bd

www.nccbank-bd.com

Manual and Brochure of NCCBL.

Annual Report 2012, NCC Bank Ltd.

Annual Report 2013, NCC Bank Ltd.


http://www.nccbank-bd.com/

http://www.bangladesh-bank.org.bd/